USGIF GotGeoint BlogUSGIF promotes geospatial intelligence tradecraft and a stronger community of interest between government, industry, academia, professional organizations and individuals focused on the development and application of geospatial intelligence to address national security objectives.

January 31, 2017

At Distributech 2017 in San Diego, the opening keynotes used the word "transformation" to refer to what the electric power industry is going through. Teresa Hansen likened the impact of this transformation to the War of Currents about 100 years ago when George Westinghouse and Nikola Tesla's AC won out over Thomas Edison's DC. At the Smart Gird Interoperability Panel 2016 Grid Modernization Summit in Washington DC Anne Pramaggiore, President and CEO of ComEd of Chicago, was the first to call the current business transformation that the electric power industry is experiencing a "revolution". And many other speakers at the SGIP conference agreed with this characterization.

Another key theme at this year's Distributech is greater uncertainty. Philip Mezey, President and CEO of Itron, mentioned regulatory and federal uncertainty specifically referring to the challenge of keeping regulation current with rapidly changing technology and utility business models. But he sees many opportunities in addition to the challenges. He mentioned managing deep solar penetration, ensuring cybersecurity, gowing numbers of EV vehicles, transactive energy, the digital grid enabling utilties to optimize power delivery, improved integration with customers, and moving beyond the smart grid by connecting more smart devices all of which are capable of collecting data. He also believes that this new grid, referred to by some as Grid 3.0, is going to require distributed intelligence because decisions have to be made locally and quickly.

Scott Drury, President of San Diego Gas and Electricity, who aspires for SDG&E to be the best energy utility in the U.S., outlined some of the innovative things that SDG&E is doing to ensure clean, safe and reliable energy for its customers. It outperforms California's Renewable Energy Portfolio in reducing emissions. It has over 100,000 rooftop installations in its service territory and boasts that it is able to make the fastest solar interconnections in the U.S. It is aggressively installing charging stations in its service territory including a target of ensuring 10% of these chargers are in disadvantaged communities. SDG&E has implemented its own weather network with many realtime reporting stations to help reduce the risk of wildfires. It has undergrounded 60% of its network. It has implemented a microgrid in a remote desert community and it is building one of the biggest lithium ion battery projects in the U.S., a substation in Escondido with energy storage capable of delivering 30 megawatts for four hours.

May 09, 2016

Don't underestimate how easily a regulated industry can be disrupted by a little technology and a better price. Referencing Uber and the regulated taxi industry, that was one of the key messages that Peter Fraser, Vice President, Industry Operations and Performance, Ontario Energy Board (OEB), left his audience with at the Future of Canada's Utilities Summit in Toronto. Those are strong words from a senior executive at the organization responsible for regulating the electric power and natural gas industries in Ontario, a province with ten million people and the largest economy in Canada.

He went on to say that the electricity sector in Ontario is undergoing a profound change, an even bigger change than the introduction of the wholesale electricity market in the 1990s. He mentioned low carbon economy, new technologies to generate, transmit and distribute electricity, and the changing needs of their customers as the major drivers of this change that will reshape utilities. He said that regulators such as the OEB need to adapt regulation to this new world, including the way electricity is priced. Electricity needs to be priced in a way that increases system efficiency, gives customers the control they want including greener energy, and encourages innovation in an industry that has traditionally been focused on keeping the lights on with 100 year old technology.

New technology that is driving change includes solar PV, smart meters and other smart devices, and electric power storage. But the “secret sauce” behind all of this is the penetration of modern communications technologies such as wireless and packet switched networks into the electric power grid. Together these technologies are enabling microgrids, which Peter sees as an important part of the future for utilities.

Consumers, whose relationship with their power utility in the past has been a monthly bill, now expect a much more complex relationship with their utility. They expect to sell power to the utility, want to install their own power technology, want less fossil fuel generated power and will most likely use less power from the utility. Distributed renewable generation and a non-traditional demand curve are directly impacting utility revenue and forcing a change in the utility business model. Nearly every speaker at the event referred to the "duck curve" (graphic from CAISO) which shows demand dropping during the day as a result of customers generating their own power during the day, but which represents falling revenues for utilities who continue the traditional utility business model of selling electricity.

To begin to address the changing landscape of power generation and demand, the OEB has several initiatives underway. A OEB report released last November concluded that the Regulated Price Plan (RPP) in Ontario had been moderately effective in shifting residential load, but ineffective in shifting small business load. In response to the report the OEB is laying out a five-point plan to be implemented over the course of the next 3 to 5 years. The OEB intends to redesign the RPP roadmap to respond to policy objectives, improve system efficiency, and give consumers greater control. The five components of the new RPP roadmap are focussed on renewing the RPP objectives, empowering consumers by enhancing energy literacy and non-price tools, implementing price pilots, engaging with small business consumers, and working with government to reduce barriers.

The OEB will roll-out new price plans beginning in 12 months. The new RPP will reflect that distribution systems will have to change to accommodate more power coming from customers, that the demand for power demand for power is falling, but that the costs of utilities in maintaining the grid need to be covered.

What this will be mean for residential customers in Ontario is a fixed monthly charge for distribution services. This is similar to what other utilities such as Sacramento Municipal Utilities District (SMUD) are doing. For commercial and industrial customers the price of electric power will be determined by peak consumption, but price signals will allow customers to choose to shift their load to off-peak times. This potentially will be a win-win situation where customers reduce their electric bill and the utility benefits from a reduced peak load. The new price plan will also aim to encourage innovation. One of the areas where the OEB sees innovation occurring is behind the meter, where microgrids are expected to proliferate in the future.

As I have blogged about before, in the new world of electric power sometimes referred to as Grid 3.0, location will play a strategic role, as an essential component of "nowcasting" generation from intermittent sources such as solar and wind as well as increasingly granular demand estimation. It also provides the foundation for integrating data from smart devices, operational systems, and external data sources for real-time situational assessment.

In Ontario nearly all electricity customers have smart meters. Ontario is unique in North America in that all of the usage data from smart meters for the entire province, about 4.9 million residential and small business consumers, are stored in a central repository called the Smart Meter Entity (SME). To date little has been done to take advantage of this valuable repository of electricity usage data. The current database lacks some important information that would help make this data more useful. For example, currently it can't distinguish between residential and small business customers and it lacks location information. The OEB has asked the SME to collect postal code, type of consumer, and some other useful information. It also is being asked to anonymize that data so that it can be made available to third parties.

Attracting young people especially digital natives to the electric power has been challenging because in the past the power industry was not perceived as an exciting industry to be involved in. That is changing. Not only has new technology, especially digital technology, made electric power one of the most rapidly changing and exciting industries to be in, but it also means that utility employees are becoming agents of change with the potential to deliver social good. Power employees once again will be the good guys, as they were 100 years ago.

It looks like big changes are coming to the Ontario energy retail market, and they may be coming sooner that we expect.

February 25, 2016

Keep a close watch on the Hawaiian power utilities (HECO) because Hawaii has committed to 100% renewables by 2045 and 65% by 2030. That was the recommendation of Sharon Allan, CEO of the Smart Grid Interoperability Panel (SGIP) at a DistribuTECH2016 MegaSession on distributed energy resources (DER) in response to a question from the audience asking what should utilities do to get ready for GRID 3.0.

Hawaii already has 487 MW of solar PV capacity, 90% of which is residential rooftop panels. At DistribuTECH2016, Talin Sakugawa from HECO and Matthew Shawver from in2lytics gave an insightful presentation on distributed energy generation (DER), big data and analytics at the Hawaiian power utility. Hawaii has seen an exponential rise in rooftop solar PV. As a result since 2010 the utility has been experiencing a reduction in net load and revenue. The most dramatic drop in load is during daytime hours as is readily apparent by comparing the utility's load on clear and cloudy days which reflects the impact of residential solar PV.

Challenges facing utilities

The Rocky Mountain Institute (RMI) has published an analysis of the economics of leaving the grid. The central thesis is that solar PV and electricity storage enables consumers to leave the grid completely. Solar PV has already reached grid parity in about 10% of the U.S. and declining PV prices suggest that this trend will continue. However, without the ability to store electric power, consumers with rooftop PV still require the grid for nights and cloudy days. The development of combined solar PV and batteries from Tesla and others promises to make solar + storage accessible for increasing numbers of consumers. These consumers could form their own microgrid, either by themselves or with their neighbours and disconnect from the grid. Alternatively they could become a source of dispatchable power and become an energy provider. Increasingly they could find that either of these options is economically advantageous. This has serious implications for local utilities because if this trend develops it will seriously erode the traditional utility revenue base. It could also lead to a completely decentralized grid comprised of many microgrids. From an operations perspective it increases the complexity of managing the grid compared to the centralized model in use today.

The other challenge for a utility with a high penetration of intermittent, distributed generation (DER) is load balancing, ensuring that generation meets demand. The German power industry, the U.S. Department of Energy, Hawaiian power utilities, California power utilities, ERCOT, and many others are working to address this challenge. HECO's presentation at DistribuTECH gave an insightful overview of what they are doing to meet this technical challenge.

Data sources

HECO collects a large amount of data from diverse sources. It is comprised of internal operational data plus data from esternal sources. It includes weather forecasts, data from customer sited PV, consumer/public resource data, phasor (PMU) data, renewables power quality, feeder data, irradiance meters, generator and substations power quality, SCADA, and vendor data such as forecasts and data from Independent Power Producers (IPPs). The data has widely different time resolutions ranging from real time such as PMUs sampling 30 times per second, SCADA reporting every 2 seconds, calculated gross load every 2 seconds, PV inverter data reporting every 5 minutes and aggregated monthly, weather forecast reporting every 15 minutes and aggregated daily, transformers collecting data every 15 mins and aggregated monthly, and smart meters reporting every 15 minutes and aggregated quarterly. Much of the data includes location. The data comes in different formats and has different levels of quality.

Fundamental to distributed energy are weather maps. Maps of irradiance and wind velocity can be directly used to estimate or predict solar and wind generation in different parts of the islands. Temperature maps are also important because the efficiency of solar panels depends on temperature. The more accurate the weather forecasts are, the more predictable the generation. Knowing that there it will be cloudy over the south of Oahu, but sunny over the rest of the island, or cloudy over the whole island, but with moderate to strong winds allows operations to estimate how much backup generation is required and where.

EMS Integration

Data from new sources relating to distributed renewable generation are integrated with traditional sources in a distributed energy management system which enables operations and planning visibility into how distributed generation is impacting thte grid. It not only provides a view into the status of the grid (situational awareness) but also allows simulations to assess the impact of different future renewable generation scenarios on the grid. This helps to determine where backup generation may be required because high demand and low generation from renewables or curtailment when there is excess generation and insufficient load. Location is fundamental to the analytics, because wind and irradiance varies widely over the islands.

Traditional input sources include SCADA and data from transmission, generators, protection, and so on. The new input data sources include GIS-based infrastructure models and data from the distributed generation sources. Also new is weather forecasting which enables predicting generation from renewable sources. It also includes historical and actual weather reports, and satellite and other weather data.

HECO uses an IT platform from In2lytics (a spinoff from Referentia) which integrates all of these time series data with EMS, SCADA, CIS, and GIS and makes it available to operational users, planners, modelers and the public. in2lytics is a high performance time series database that is specially designed to provide instant data accessibility for planning and operational decision making. in2lytics enables load, query, analysis using MATLAB, and sharing of the "big data" required to monitor and manage today’s complex electric grid. in2lytics has native high performance interfaces for MATLAB in addition to programming languages. It translates data from different sources into its internal time series database. All data is archived in a spatially enabled time series database for future analysis. Matthew said that in2lytics is able to analyze large volumes of historical time series data very rapidly. For example, a longitudinal analysis on two years worth of archived data can be run in an hour or two.

Applications

Accounting for renewables requires a lot of data. Some areas that use this data include generation planning, load forecasting, distribution planning, and contract administration. One of the first applications is a customer facing web site called Renewable Watch - Oahu that reports the total renewables generation, solar and wind, on Oahu in real-time.

An example of an application that will be used for contract administration beginning next month estimates how much power is lost from Independent Power Producers (IPPs) in the case of curtailment. It uses weather information to estimate wind speed and irradiance meters to estimate wind and solar generation potential.

Another analytical application was used to study how solar PV variability affects transformer tap changes. This application allows HECO to relate frequency of tap changes to solar PV variability and to determine which transformers are most affected by solar variability.

HECO has a number of projects with the Department of Energy and other partners.

Department of Energy's Integrating System to Edge-of-Network Architecture and Management" (SEAMS) A federally-funded research initiative on high penetration grids which aims to streamline grid planning and operations for utilities in regions with high concentrations of distributed generation (DG) resources.

Department of Energy's Distributed Resource Energy Analysis and Management System (DREAMS) Department of Energy system to provide useful information about the distributed grid to grid operators.

Making sense of synchrophasor data for utilities. The Synchrophasor Visual Integration and Event Evaluation for Utilities (SynchroVIEEU) with High Penetrations of Renewables. Accelerate the integration of synchrophasor information into production grade data visualization and analysis platforms/models. Leverage PMU capability at many substations – explore ways to tap resources and provide real-time visibility and real-time data. Make synchrophasor data accessible for efficient and reliable operations of a modern grid in light of high penetrations of renewable resources

Partners: SEL, DNV GL, Referentia

Monitoring, planning, and modeling high PV penetration microgrid. Decision support for microgrid design and operation at Marine Corps Base Hawaii. The Office of Naval Research (ONR) has launched an ambitious program to demonstrate and evaluate energy technologies using Navy and Marine Corps facilities as test beds, known as the Energy Systems Technology and Evaluation Program (ESTEP). Program management is being handled by the Space and Naval Warfare Systems Command (SPAWAR) Systems Center Pacific (SSC Pacific). ESTEP was established in 2013. It brings together the Department of the Navy, academia, and private industry to investigate and test emerging energy technologies at Navy and Marine Corps installations. At present, ESTEP conducts over 20 in-house government energy projects, ranging from energy management to alternative energy and storage technologies.

Other projects include

Remote light sensor technology at the Kahuku wind farm on Oahu to measure and forecast windspeed and direction to support reliability;

The ultimate objective for HECO is to become a company offering diversified services providing value to engaged customers, of course with satisfied regulators and sustainable costs and margins.

Big data and spatial-temporal analytics

It was clear from this presentation that essential for HECO, or to any utility, with a high penetration of solar or wind are weather maps, forecasted, actual and historical because these enable the utility to project generation. The also allow utilities to analyze the historical record in conjunction with other data to discover trends that may help improve forecasting. Collecting and analyzing temporal geospatial data is fundamental for distributed energy management. This is in addition to the expanded application of geospatial technology for utility operations and planning in the smart grid era.

May 26, 2015

At the beginning of May Elon Musk gave a presentation is which he offered his vision of an alternative to fossil fuels as the future of humanity's energy sourcing and delivery. Musk's long term objective is global carbon free energy for power generation and transportation. He announced Tesla Energy and its first products, lithium-based Powerwall consumer (10 kWh) and Powerpack utility-scale (100 kWh) batteries. He also discussed a third product, GigaFactory, which he described as a gigantic machine to manufacture Powerwall and Powerpack batteries.

Elon Musk is an entrepreneur with a vision for humanity. He is the chairman of SolarCity and his vision for practical carbon-free energy helped start the company. SolarCity has already had significant transformative impact on the traditional power utility business model. He is also the founder and CEO of Tesla Motors, a manufacturer of electric vehicles and batteries. (He is also CEO of Space-X, but that's another discussion.) Musk is proposing a fundamental transformation of how the world works, by developing an alternative model for how energy is sourced and delivered. He believes it is possible with solar and batteries to wean the world off fossil fuels and reduce anthropogenic CO2 emissions to near-zero.

The Problem

The world's electric power and transportation is powered by burning fossil fuels. The result is that anthropogenic CO2 emissions have pushed atmospheric CO2 concentrations (first recorded by climate scientist Charles Keeling) to levels not seen even in the paleoclimate record.

The Solution

Musk thinks that collectively we should do something about this, but is has to be practical (and not win the Darwin award). His proposal for a solution has two parts.

1. SolarMusk pointed out that we have this "handy fusion reactor in the sky" in the sun. We don't have to do anything except harvest the energy. Musk calculated the total surface area needed to generate enough power to get the U.S. completely off fossil fuel power generation. Shown as a blue square on Musk's slide it covers less than 1/4 of the Texas panhandle.

2. BatteriesThe obvious problem with solar energy is that the sun does not shine at night and even during the day the the power generated varies. Energy captured from the sun needs to be stored. Battery technology has evolved to the point where the size of the batteries needed to wean the U.S. power generation off fossil fuels is the size of a pixel ("the red pixel") on Musk's slide.

In Musk's view what is needed is a battery that simply works. A battery that doesn't require a lot of space, is reliable, works with existing home electrical networks and solar installations, is safe, can be used for years and is affordable. The Tesla Energy consumer battery, the Powerwall, is wall-mounted and comes in different colours so you don't need a battery room. It stores either 7 kWh (priced at $3000) or 10 kWh ($3500) and can be stacked for up to 90 kWh. To put this in context the average Ontario homeowner uses about 800 kWh a month in energy which translates to an average of 27 kWh a day. The Powerwall comes with a 10 year warranty.

What it gives you is peace of mind. You don't have to worry about being without power after an ice storm. It also gives consumers energy independence. Together with solar panels with these batteries consumers can go completely off the grid. This presents a huge challenge to the traditional electric power utility business model, comparable to the impact of cell phones on traditional land-line telephone companies.

Powerwall is targetted for homes and small commercial sites. You can order the Powerwall right now on the Tesla web site. Musk said that shipping will start in 3 to 4 months. Initially the rampup will be slow because the batteries will be made in Tesla's Freemont, California factory. But next year the rampup will accelerate as Tesla transitions to its Nevada Gigafactory.

Tesla is not the only company producing this type of battery. Aquion Energy and Iron Edison are also also producing consumer-scale power batteries. You can see how Tesla's Powerwall and these other companies' products compare from a financial perspective here.

Powering remote locations

Battery power is even more crucial for people in remote locations where there is no grid (remote parts of India and Africa), electricity is intermittent (many urban areas in India), or extremely expensive (northern Canada). Musk thinks that the Tesla Powerwall can scale globally. What he expects to see is what happened with cell phones and landlines. The cellphone leapfrogged the landline. There wasn't any longer a need to put landlines in remote locations. People on islands or remote locations can install solar panels and Tesla Powerwalls and never have to worry about electicity lines.

Utility-scale battery storage

The Tesla Powerpack (100 kWh), which is designed to scale infinitely, can provides gigawatt power. According to Musk Tesla Energy is already working with a utility on a 250 mWh Powerpack installation.

Emphasizing that the Powerpack is a reality, Musk announced that the entire evening event had been powered by Powerpack batteries that had been charged by the solar panels on the roof of the building where the event was taking place. The entire evening was powered by stored sunlight.

Tesla's competitors in this market include Eos Aurora and Imergy Flow. You can see how Tesla's Powerpack and other companies' products compare financially here.

The big picture: transitioning the world to sustainable energy

Musk calculated that 900 million Powerpacks would be required to transition the world to renewable electric power (90,000 GWh). To transition the world to renewable electric power and electric powered transportation would require 2 billion Powerpacks.

Musk made the case that this is something that humanity is capable of by looking at what humanity has already done with transportation. There are about 2 billion cars and trucks on the road. About 100 million cars and trucks are produced every year so that the world's transport fleet gets refreshed every 20 years. Musk's argumemnt is that if we can do it with vehicles, it is within our power to do it with batteries.

This is the reason that Tesla's approach in developing the Gigafactory is to treat it as a product. They are designing a giant machine for making batteries. Musk foresees that there needs to be many gigafactories in the future. He emphasized that this is not something that Tesla is going to do alone. Many other companies need to develop their own gigafactories.

Musk also announced that Tesla's policy of open sourcing patents will continue for gigafactories, Powerwalls, Powerpacks, and other technologies.Musk foresees with this technology a future where the Keeling curve will flatten and where there will be no incremental anthropogenic CO2 increase. The path that he has described based on solar panels and batteries is the only path that he knows can achieve this. In his view it is something that we must do, that we can do, and that we will do. I have to agree with Ed Parsons. This is on the level of Steve Jobs revolutionizing consumer electronics and commercial music delivery, but working on the "slightly bigger challenges" of carbon-free transportation and power generation.

Stuart Laval, Smart Grid Technology Manager at Duke, presented an overview of the COW II project. At most utilities the current architecture is a collection of proprietary application silos with no field interoperability. What interoperability there is is via the enterprise service bus in the central control office. Duke is proposing a distributed intelligence platform (DIP) with seamless interoperability in the field. Duke's plan is to implement a Common Information Model (CIM) into an OpenFMB field message bus which is based on mature standards - OMG Data Distribution Service and Message Queue Telemetry Transport (MQTT) which is now an OASIS Standard. CIM provides semantics in the form of standardized object model representations.

The use case is a islandable microgrid. The microgrid will include solar and battery storage and will use wireless to support field communication between all the devices on the distribution grid.

Demonstrate interoperability based on CIM between open publish/subscribe standard protocols including DDS and MQTT.

Develop and demonstrate "edge of the grid" applications such as volt/var and solar smoothing.

Demonstrate live interoperability at DistribuTECH 2016.

Duke has lined up 25 vendor partners to support the COW II effort. For most types of equipment, there are two vendor partners that can provide the equipment. For example, Elster and Itron manufacture smart meters.

A key part of the demonstration is a field message bus based on open standards. Duke is working with a number of partners to support this effort.

Smart Grid Interoperability Panel (SGIP)

North American Energy Standards Board (NAESB)

National Renewable Energy Lab (NREL) DOE INTEGRATE project

EPRI Integrated Grid program

CPS Energy "Grid of the Future" deployment in San Antonio

The Smart Grid Interoperability Panel (SGIP) has already created an OpenFMB working group to support this effort.

Solar PV has already reached grid parity in about 10% of the U.S. and declining PV prices suggest that this trend will continue. However, without the ability to store electric power, consumers with rooftop PV still require the grid for nights and cloudy days.

The development of combined solar PV and batteries from Tesla and others promises to make solar + storage accessible for increasing numbers of consumers. These consumers could form their own microgrid, either by themselves or with their neighbours and disconnect from the grid. Alternatively they could become a source of dispatchable power and become an energy provider. Increasingly they could find that either of these options is economically advantageous. This has serious implications for local utilities because if this trend develops it could seriously erode the traditional utility revenue base. It could also lead to a completely decentralized grid comprised of many microgrids. From an operations perspective it increases the complexity of managing the grid compared to the centralized model in use today.

Jon Wellinghof, previous chairman of FERC, thinks that the writing is on the wall and it is being driven by customers wanting more control of their energy. He said

"Advances in technology and the desire we are seeing at the consumer level to have control and the ability to know that they can ensure the reliability of their system within their home, business, microgrid or their community. People are going to continue to drive towards having these kinds of technologies available to them. And once that happens through the technologies and the entrepreneurial spirit we are seeing with these companies coming in, I just don't see how we can continue with the same model we have had for the last 100 or 150 years."

Over the past decade,distributed generation, especially solar photovoltaic (PV), consumer demand response programs, and other flexible distributed resources of electric power has grown dramatically. Until now, with a few exceptions such as Germany and Hawaii, distributed intermittent resources have represented a relatively small proportion of total power generation. However, as we face the prospect of scaling the use of flexible distributed energy resources including affordable energy storage batteries, attention is focussing in many jurisdictions not only on the economics of distributed energy, but also on the control system that will balance intermittent micro-generation resources and consumer demand and the rapid evolution of new consumer devices, aka the Internet of Things. This has led to the concept of transactive energy.

Transactive energy refers to the combination of economic and control techniques to improve grid reliability and efficiency. These techniques may also be used to optimize operations within a customer’s facility. The Department of Energy has supported the GridWise Architecture Council in developing a conceptual framework for developing architectures, and designing solutions related to transactive energy.

A virtual power plant (VPP) is a cluster of distributed generation installations and demand response programs which are collectively run by a central control entity. VPPs rely on existing utility grid networks to provide electricity supply and demand services for a customer. VPPs are intended to add value for both the end user and the distribution utility. As a practical application of transactive energy concepts, virtual power plants represent a way of integrating technologies including demand response, distributed generation systems, and advanced energy storage into a network supporting sophisticated planning, scheduling, and bidding of DER-based services.

For example, RWE Deutschland AG and Siemens carried out a trial project with hydro power plants, combined heat and power units and emergency power systems. The pilot project demonstrated the technical and economic deployment feasibility of virtual power plants. Since February 2012, the electricity produced by RWE's virtual power plant is traded on the Energy Exchange (EEX) in Leipzig.

March 10, 2014

According to Bloomberg AES Corp has begun selling utility-scale battery systems that can scale up to half a gigawatt (GW). The Advancion systems cost from $10 million to $500 million, depending on size, and will be offered to utilities and renewable-energy developers.

AES has operated its own utility battery systems in the U.S. and Chile for more than two years. For example, AES owns a 64 MW battery system at the Laurel Mountain wind farm in West Virgina that competes in the PJM wholesale power market.

Advancion batteries can store power from intermittent sources such as wind or solar or when it is cheap on the grid and then feed it to the grid during periods of high demand. The battery systems are able to replace gas-fired peaker plants. Advancion systems, which can supply power for as long as four hours, will cost about $1,000 per kilowatt, compared to about $1,350 a kilowatt for a recently built gas peaker plant.. Advancion acts as both generation and load to enable more than twice the flexible range of a peaker plant on the same interconnection. Advancion’s modular nature with no local emissions allows it to be sited closer to load, reducing the need for transmission build out in congested areas while improving local reliability.

The first Advancion systems will use lithium-ion batteries from LG Chem Ltd , a Korean manufacturer., the same technology used in laptop computers, smartphones and electric cars. AES intends to certify other battery suppliers at its Indianapolis test facility.

AES is offering the systems in Hawaii and California, where demand for wind and solar farms is increasing, and in regions served by PJM Interconnection LLC, the largest U.S. wholesale power market which includes Chicago, Ohio, Pennsylvania, Virginia, West Virginia, New Jersey and parts of other states.

Solar PV has already reached grid parity in about 10% of the U.S. and declining PV prices suggest that this trend will continue. However, without the ability to store electric power, consumers with rooftop PV still require the grid for nights and cloudy days.

The development of combined solar PV and batteries from Tesla and others promises to make solar + storage accessible for increasing numbers of consumers. These consumers could form their own microgrid, either by themselves or with their neighbours and disconnect from the grid. Increasingly they could find that it is be economically advantageous to do so. This has serious implications for local utilities because if this trend develops it could seriously erode the traditional utility revenue base. Generally this would lead to increased rates for the remaining customers still on the grid, which would tend to encourage more customers to leave the grid.

The RMI analysis attempts to show when and where U.S. customers could chooseto bypass their utility without incurring higher costs or decreased reliability. It focuses on five U.S. regions New York (Northeast) , Kentucky (Midwest) , Texas (South), California (West), and Hawaii which has some of the highest power rates in the U.S.

RMI modeled four scenarios:

Base case—Uses an average of generally accepted cost forecasts for solar and battery systems that can meet 100% of a building’s load, in combination with occasional use of a diesel generator

RMI compares its estimates of costs per hWh for combined solar PV and storage with projected retail electricity price forecasts from the U.S. Energy Information Administration (EIA).

RMI arrives at some interesting conclusions.

Solar-plus-battery grid parity has already happened or is coming soon for a rapidly growing minority of utility customers. For many customer segments in Hawaii, grid parity is already here. It will likely be here before 2030 and even as early as 2020 for tens of millions of commercial and residential customers in other geographies including New York and California.

Motivating factors such as more control over their power (Jon Wellinghof, outgoing chairman of FERC has emphasized the importance of this.) and the desire for low-carbon electricity generation will attract early adopters even before grid parity is reached.

Because grid parity could arrive within 30 years or even sooner for some parts of the U.S., the traditional utility business model based on cost recovery through kWh sales is rapidly becoming obsolete.

As I have blogged before some utilities have foreseen this scenario and have been actively looking at alternative business models.

December 05, 2013

Lux Research recently released a report Batteries Included: Gauging Near-Term Prospect for Solar/Energy Storage Systems that projects that the coupled Solar and energy storage (lithium ion batteries) market will grow to $2.8 billion in 2018. Lux projects that residential applications will be the primary driver through 2018 growing to 382 MW in 2018. It will be followed by the light commercial segment which is projected to reach 220 MW by 2018. Most of the installations (95%) will be linked to the electric power grid.

The home battery system is wall-mounted and about the size of a solar power inverter. A fully charged battery will power basic home needs for a few days and a solar powered home can recharge the battery from the sun to run indefinitely. Basic home needs include charging cell phones, basic lighting, and home security systems.

In the commercial market the battery system is being marketed primarily as a backup system during emergency power outages.

But another benefit is targeted at people and businesses on a time-of-use tariff, because the battery can be used to shift power grid consumption from peak to off-peak. For the same overall power usage, this will reduce the monthy power bill.

Coupled solar and storage

Solar photovoltaic (PV) cells installed on the roof generate direct current (DC) when hit by sunlight. The DC power is converted by an inverted into alternating current (AC) power. The AC power travels goes to a breaker box.which connnects it to your home AC electricity network. Any excess DC power is uses to charge the battery. The home remains connected to the utility grid so you can use grid power when it is available.

The basic requirement for energy storage equipment is that it must be dispatchable, capable of providing full capacity when requested, typically at peak, for at least two hours. In addition it must be able to provide a minimum of four hours of full power over three consecutive days. The California ISO market will actually determine when the battery power is actually used. Each energy storage project must have a capacity of at least 0.5 megawatts. Energy storage projects are to be interconnected similarly to generation resources with SCE in control of charge and discharge.